High childcare fees act as a 'barrier' to parents returning to work

UNAFFORDABLE: Childcare costs have skyrocketed.
UNAFFORDABLE: Childcare costs have skyrocketed.

HUNTER families saw their childcare fees rise more than the rate of inflation over 12 months, with fees set to keep eating into out of pocket costs over the next four years.

Department of Education, Skills and Employment data shows the mean per-hour centre based daycare fee rose between the March 2019 and March 2020 quarters by 6.4 per cent in the Lower Hunter, five per cent in the Upper Hunter, 4.9 per cent in Maitland, 4.7 per cent in Lake Macquarie East, 4.4 per cent in Lake Macquarie West, 3.6 per cent in Newcastle and 3.2 per cent in Port Stephens.

Shadow Minister for Early Childhood Education and Development Amanda Rishworth said the increases made childcare progressively unaffordable.

"The Lower Hunter in particular, with an annual increase of 6.4 per cent, has been subject to fee hikes well above the national average," she said.

"These fee increases substantially outstrip inflation, which the Child Care Subsidy [CCS] is pegged to, meaning local families are paying more and more out of pocket.

"Without access to affordable child care, parents will be unable to work the hours and days they want - which is bad for families and for our economy.

"We know high child care fees are not only a hit to household budgets, but can also act as a barrier for parents, especially women, to go back to work."

Ms Rishworth said Labor would scrap the $10,560 child care subsidy cap; lift the maximum subsidy rate to 90 per cent; and increase subsidy rates, tapering them for every family earning less than $530,000.

She said this would make care more affordable for 97 per cent of families.

Senator Louise Pratt said in response to a Question on Notice the projected hourly fee growth for long daycare would be 4.9 per cent this year, 3.5 per cent from 2021-22, 4.6 per cent from 2022-23 and 3.2 per cent from 2023-24.

A department spokesman said child care affordability had improved since the introduction of the CCS in July 2018.

"In the March quarter 2020, out-of-pocket child care costs were 3.2 per cent lower than their peak in the June quarter 2018," the spokesman said.

"The CCS is means-tested to ensure those who earn the least receive the highest level of subsidy.

"Around 90 per cent of families using approved child care are entitled to a subsidy of between 50 and 85 per cent of fees.

"The projected increases in Centre Based Day Care fees across the forward estimates is below the long-term average of 5.6 per cent per year.

"While the hourly rate cap and the CCS taper are adjusted by CPI, the rate of subsidy is not.

"About 85 per cent of services have an average hourly fee that is below or on par with the hourly rate cap.

"For families attending those services, the proportion of their fee that is subsidised by CCS remains the same."

Paterson MP Meryl Swanson said the Coalition's child care system was "broken" and families in her community were paying the price.

"I've had a rise in the number of families, especially working mums, contacting my office for advice and assistance because of the increasing costs of childcare," Ms Swanson said.

"Parents across my region are in need of a government that will support them to tackle these challenges.

"I want families supported with the best possible childcare and the opportunity for parents, particularly women, to work as much as they want."

Newcastle MP Sharon Claydon said Australian families were paying some of the highest child care fees in the world.

"The last thing our economy needs at the moment is for parents to not be able to afford to work because of the high cost of childcare," she said.

"But this is exactly what is happening.

"Childcare isn't welfare - it's a critical workforce participation tool.

"When childcare fees are so high that they lock people out of work, our entire country pays the price."

Shortland MP Pat Conroy said childcare had been unaffordable for too many families for too long.

"This isn't a new issue - for years I've been hearing from constituents who cannot afford to enrol their kids into childcare, and coalition governments have done nothing to fix the problem and keep a lid on out of pocket costs," he said.

"The fact that the government's own education department is predicting more increases in the coming years while many families are still struggling with the financial impacts of the COVID-19 pandemic is unacceptable.

"Scott Morrison has a choice.

"He needs to back Labor's plan to make child care far cheaper for 97 per cent of families, or he needs to explain to working families in my electorate why it's okay that their childcare fees have risen by a huge 4.7 per cent over 12 months."

Hunter MP Joel Fitzgibbon said families who were looking forward to entering the new year starting fresh would be left feeling "let down knowing their rising child care fees will rise even more".

"Looking back since the Liberal/National Government was elected in 2013, nationwide child care fees have soared by 35.9 per cent, and given the future predictions, there is no end in sight," he said.

"There can't be a worse time for families to experience more unnecessary hits to their budgets. This evidence is clear the Liberal/National Government's child care system is broken.

"Families in my electorate are still right in the middle of recovering from the effects of COVID-19 - this is the last thing they need."

This story High childcare fees act as a 'barrier' to parents returning to work first appeared on The Maitland Mercury.